Arguello v. Conoco, Inc.
United States Court of Appeals for the Fifth Circuit
207 F.3d 803 (2000)
A Conoco-branded store clerk yelled racial epithets and profanities at Arguello and Govea (plaintiffs) while processing their purchase, continuing over the store's intercom after they left; Conoco (defendant) counseled but didn't discipline the clerk, and the district court found no agency relationship existed either between Conoco and the clerk (finding she acted outside her employment scope) or between Conoco and the independently-operated branded stores generally, based on a marketing agreement giving Conoco no control over daily store operations.
Whether an agency relationship exists between (1) an employer and an employee who performs acts unacceptable to the employer in the course of employment, or (2) a company and stores displaying the company's brand if the company is not involved in the stores' day-to-day operations.